The Federal Trade Commission (FTC) has voted to ban most noncompete agreements in all industries. The rule would ban:
- future associate agreements in dentistry
- retroactively rescind existing associate agreements
The FTC expects the rule will reduce patient spending by “up to $148 billion annually on health care costs and double the number of companies founded by a former worker in the same industry.”
Former employees who have been restricted from practice ownership by onerous noncompete agreements that included large noncompete areas and long time periods, will no longer face such hurdles.
As of 2023, attorneys often recommend against their clients violating noncompete terms in their existing employment contracts.
The final version of the proposal is scheduled for a vote in April of 2024. If and when the noncompete ruling is approved, it will not become effective until 60 days after publication in the National Register. From the publication date, employers will have 180 days to implement compliance.
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